Midsize Daily Fantasy Sports Website Seeks To Prove Its Contests Are Games Of Skill, Not Chance

I write about legal issues in sports, fantasy sports and online gaming

In order for a "daily fantasy sports" contest to be legal under federal and state laws, the underlying contest must be deemed a "game of skill" rather than a "game of chance." To date, no "daily fantasy sports" company has ever published a study to prove that their contests meet this important threshold. However, one of the midsize "daily fantasy sports" websites, Star Fantasy Leagues, claims to be very close to doing just that.

According to Seth Young, who is Star Fantasy Leagues's Chief Operating Officer, the midsize Rochester, NY company recently commissioned Gaming Laboratories International to produce a study comparing the performance of "skilled" players in its contests against entries created randomly when using ninety percent or more of the contest's allocated salary cap budget.

According to a segment of the Gaming Laboratories International report shared with FORBES, Star Fantasy League's "skilled' fantasy football players (meaning, those who performed the best over the previous week) purportedly beat randomly generated lineups that used ninety percent or more of the provided salary cap space 69.10% of the time, with a +/- 0.69% variability over a 95 percent confidence interval.

Presuming the methodology used in this commissioned report is found to be scientifically proper, these findings would seem to represent a tremendous coup for Star Fantasy Leagues. Indeed, if the methodology used is ultimately supported by others, it would provide at least some evidence that Star Fantasy Leagues's daily football contests might comply with gambling laws in those states that apply a "predominant purpose test" for determining the minimum threshold of chance needed for legality.

Rochester, NY based Star Fantasy Leagues is taking important steps to try to prove daily fantasy sports is a game of skill

Of course, the findings of this study, even if correct, do not help to establish the legality of any other company's "daily fantasy sports" contests, or any other formats of Star Fantasy Leagues contests other than the particular football contest tested. In addition, the study described by Young does not help to support an argument of legality in states where contests involving any chance whatsoever are illegal such as in Arizona, Arkansas, Iowa, Louisiana, Montana, Tennessee, and perhaps Washington, or even necessarily in states that disallow contests entailing a material element of chance such as Missouri or New York.

Kudos to Star Fantasy Leagues for taking an important step toward attempting to prove the skill element of at least one of its "daily fantasy sports" contests. If a midsize company such as Star Fantasy Leagues is able to take such an important step toward trying to prove contest legality, there is absolutely no reason why the larger and deeper pocketed companies in the "daily fantasy sports" marketplace cannot exercise at least a comparable level of gaming-law due diligence.